Hi all I need help with are the multiple choice, i just sent everything so that you could see all of the info
Required 1a. Compute Cost of Goods Sold under each method of inventory: average cost, FIFO, LIFO, and specific identification. For specific identification, assume that the first sale was selected from the beginning inventory and the second sale was selected from the January 12 purchase. Assume that the company uses periodic inventory system. (Round unit price to 2 decimal places. Input all amounts as positive values.) Average Cost Cost of Good Available for Sale Cost of Goods Sold Cost of Cost of Cost per Goods Unit Available for Sale | # of Units Cost per Goods #Of Units Unit Sold Beginning inventory 500 $ 2,800 Purchases: January 12 January 26 660 120 1,280 $ 5,016 $1,152 $ 8,968 Total 600 FIFO Cost of Goods Available for Sale Cost of Goods Sold Cost of Goods Available for Sale Cost of Cost per Goods Cost per Unit | # of Units Sold # of Units Unit Sold Beginning inventory 500 $5.60 $ 2,800 500$5.60 $ 2,800 Purchases: 7.60 $ 5,016 9.60 1,152 $ 8,968 January 12 100 660 120 1,280 7.60 760 January 26 Total 600 S 3,560 LIFO Cost of Goods Available for Sale Cost of Goods Sold Cost of Goods Available for Sale Cost of Cost per Goods Cost per #Of Units Unit | # of Units Sold Unit Sold Beginning inventory 500$ 5.60 $ 2,800 Purchases: 7.60 S 660 120 1,280 480 120 600 7.60 $ 3,648 9.60 1,152 $ 4,800 January 12 5,016.00 9.601,152.00 $ 8,968 January 26 Total Specific Identification Cost of Goods Available for Sale Cost of Goods Sold Cost of Goods UnitAvailable for Sale Cost of Cost per Goods Cost per #Of Units | # of Units Sold Unit Sold Beginning inventory 5005.60 2,800 400 5.60$ 2,240 Purchases: 660 120 1,280 200 7.60 5,016 9.60$ 1,152 $ 8,968 January 12 7.60 1,520 January 26 Total 600 $ 3,760 1b. Prepare a partial income statement under each method of inventory: (a) average cost, (b) FIFO, (c) LIFO, and (d) specific identification. For specific identification, assume that the first sale was selected from the beginning inventory and the second sale was selected from the January 12 purchase Assume that the company uses periodic inventory system. DONNER COMPANY Partial Income Statement For the Month Ended January 31, Current Year Specific Identification Average Cost FIFO LIFO 10,200 10,200 10,200 $ 4,206 $ 3,5604,800 5,994: $ 6,640 5,400$ 10,200 3,760 6,440 es revenue t of goods sold profit 2a. Of FIFO and LIFO, which method would result in the higher pretax income? FIFO LIFO No Difference 2b. Of FIFO and LIFO, which would result in the higher EPS? FIFO O LIFO No Difference 3. Of FIFO and LIFO, which method would result in the lower income tax expense? Assume a 30 percent average tax rate FIFO LIFO No Difference 4. Of FIFO or LIFO, which method would produce the more favorable cash flow? FIFO, because of it produces lower Income tax expense FIFO, because of it produces higher Income tax expense LIFO, because of it produces lower Income tax expense LIFO, because of it produces higher Income tax expense No difference in cash flow
